Lasting Powers of Attorney
1. A Lasting Power of Attorney
A Lasting Power of Attorney must be completed by the Donor whilst he or she is still of full mental capacity, but has the advantage that if the Donor subsequently becomes mentally incapable the Power will continue to be effective if:-
a. it is clear that this was the Donor’s intention when the Power was given; and
b. that certain legal formalities have been complied with in registering the Power with the Court of Protection.
The Power can exercised in relation to the matter if at the material time he or she is unable to make a decision for himself or herself and in relation to the matter because of an impairment of or a disturbance in the functioning of the mind or brain. That is to say it is possible for there to be mental incapacity in some matters but not in others. A person is deemed to be unable to make a decision for himself if he is unable to
a. understand the information relevant to the decision;
b. retain that information;
c. use or weigh that information as part of the process of making a decision; or
d. communicate his decision (whether by talking, using sign language or other means). A Code of Practice exists for the assistance of Doners.
The Power does not apply in relation to certain family relationship decisions nor to medical treatment for a mental disorder.
A Lasting Power of Attorney can be either general in its powers or can be limited to cover only certain situations and can cover property and financial issues and/or welfare and medical matters. The Power comes into effect immediately on registration with the Court of Protection but does cease to have effect on the death of the Donor. Provided certain fixed procedures have been complied with at the outset of making the Power, handling an elderly person’s affairs can be made simple and flexible.
2. The Court of Protection
This is a special office of the court which has considerable powers to act in relation to the property and affairs of any mentally incapacitated person. When someone is no longer able to manage his or her financial affairs by reason of mental disorder he or she may be made a client of the Court of Protection, even if an ordinary Power of Attorney has already been granted. The application can be made by relatives, solicitors and social services or even creditors. Usually a close relative or friend is appointed to act as a Deputy for the client and the Court supervises the dealings in the client’s affairs. The Court is then assisted by the Office of the Public Guardian which provides the administrative support, and can advise on the procedures involved in an application to the Court. Once appointed the Deputy is required to account annually to the Court for the client’s finances and the Court can charge an annual fee for their part in dealing with the client’s affairs. The Court also plays a role in supervising Attorneys appointed by Enduring Powers of Attorney when Donors have become mentally incapable by reference to the Code.
3. Why avoid becoming a Client of the Court of Protection?
Provided the Lasting Power of Attorney is registered at the Court of Protection it remains effective even though the Donor has become mentally incapable of managing his or her affairs.
The Court of Protection, however, still has the power to check on the Attorney’s dealings with the Donor’s affairs and has the power to make an Attorney provide full accounts. Ultimately the Court can remove an Attorney if he or she acts improperly or fraudulently or broadly within the requirement to act in the Donor’s ‘best interests’.
4. How do I make a Lasting Power of Attorney?
A Lasting Power of Attorney is a formal legal document in which the Donor appoints another person or persons to act as their Attorneys. There are two different forms relating to financial and property matters and in relation to welfare and medical matters. These forms have to be filed with the Court of Protection and a fee paid currently at £150 per form. There are specific requirements for execution of the forms and supporting certificates have to be filed with the application by a certificate provider such as a registered health care professional or solicitor. The original form with an application to register and the relevant fee is then sent to the Court of Protection and copies of notices served on relevant persons nominated by the Donor (such as relatives) who may be affected by the Power. If there is no objection to registration within 5 weeks of notice received then registration will be completed and the Power effective.
5. Who can be an Attorney?
Anyone provided they are over 18 years and not bankrupt. An Attorney should be a trusted relative or a friend who will carry out your wishes honestly and diligently or the Attorney may be a professional person such as a solicitor or an accountant. Attorneys can only do whatever is authorised by the document appointing them. An Attorney has a strict legal duty to take reasonable care in managing the Donor’s financial and property and/or welfare affairs, to keep accounts of dealing with the Donor’s money and property and to disclose any conflict of interest.
You can appoint one or more people to act as your Attorneys but you will need to decide if they are all to act together (jointly) or independently of each other (jointly and severally). If you appoint a professional Attorney you will need to consider making provision for them to charge for the work they do on your behalf. Strictly Attorneys can only cover their out of pocket expenses for acting and cannot charge for their time unless express provision is included in the document.
6. What powers will my Attorney have?
Generally speaking there are eleven factors to be ignored or taken into account in determining the Attorney’s decisions as falling within the ‘best interests’ of the Donor. These include age or appearance and some aspects of behaviour designed to exclude discrimination. All the relevant circumstances must be taken into account in decision making and, where practical, the Attorney should encourage the Donor to participate in any act or decision taken by the Attorney. The Attorney must decide so far as reasonably ascertainable according to the Donor’s past and present wishes and feelings, in particular any relevant statement made, and their beliefs and values that would be likely to influence the Donor’s decision if they had relevant capacity. The Attorney must also take into account and consult with the views of anyone named by the Donor as someone to be consulted in certain decision making. This said, Attorneys are not usually supervised in dealing with your affairs and it is important that you chose your Attorney carefully. There are provisions for you to include restrictions or conditions on your Attorney in relation to dealing with a specified bank account or that they would not be able to deal with the sale of your house. As a precaution you may wish to consider appointing more that one Attorney and for those Attorneys to act jointly or to include a requirement that your Attorney has to present an annual account to your solicitor or accountant for them to oversee the actions of your Attorney.
A. Property and Financial Affairs
A general power would give the Attorney the right to do virtually anything, such as buying and selling property, operating bank accounts, claiming benefits, dealing with the Donor’s tax affairs and investing the Donor’s savings. They do, however, have a duty not to take advantage of their position and to avoid conflicts of interest and they must not profit or get any personal benefit from their position. They must also carry out their duties personally and in good faith. They also have to act confidentially and in accordance with any directions of the Court of Protection. They also have to keep accounts although it is recognised that the Attorney may not be a financial expert and a simple income and expenditure account will suffice.
As the law stands anyone can make a Living Will which does not have to be in writing and provided an advanced statement is not illegal then ‘anything goes’. As part of a Living Will it is possible to make an ‘advanced decision’ which is one made by an adult with capacity that:-
a. at a later time in such circumstances as he may specify, a specified treatment is to be carried out or continued by a person providing healthcare for him; and
b. at the time he lacks capacity to consent to the carrying out or continuation of the treatment then and in such circumstances the specified treatment is not to be carried out or continued. An advanced decision can be withdrawn at any time and can now be incorporated in a Lasting Power of Attorney conferring authority on the Attorney to give or refuse consent to the treatment to which the advanced decision relates.
An advanced decision is not applicable to the treatment in question if at the material time the Donor has capacity to give or refuse consent to it and is not applicable to the treatment in question if:-
a. the treatment is not the treatment which is specified in the advanced decision;
b. the circumstances specified in the advanced decision are absent; or
c. there are reasonable grounds for believing that circumstances exist which the Donor did not anticipate at the time of the advanced decision and would have affected his decision had he anticipated them.
Advanced decisions in relation to obtaining treatment are crucially important particularly if life is at risk and how the power is to be exercised. In practice there may be some decisions that may have to be referred to the Court.
7. If I have made a Lasting Power of Attorney can I still deal with my finances?
You should be aware that your Lasting Power of Attorney is effective immediately after it has been registered. For as long as you remain mentally capable of dealing with your affairs, you can continue to deal with your own finances. If you wish your Attorney to assist you then they may do so, but you still have absolute power to deal with all affairs yourself. It is only when you lose capacity then your Attorney’s authority will take over.
8. If I change my mind can I cancel the Power of Attorney or change my choice of Attorneys?
At any time prior to losing your mental capacity you can either revoke an existing Power of Attorney entirely or make a new Power of Attorney appointing different Attorneys under it. You would need to do this formally and we will be able to prepare the relevant papers.
9. How much will it cost?
As Powers of Attorney vary greatly in their complexity it is not always possible to give an exact cost without knowing more facts. However, generally a simple Power of Attorney can be prepared for a fixed fee of £100.00 plus VAT. A Lasting Power of Attorney can be prepared for a fixed fee of £450 plus VAT exclusive of the registration fees. However, in certain circumstances a higher fee will need to be charged, for example, if you require a home visit or if you wish to include complicated provisions within the Power of Attorney document. These fees would, however, be much cheaper and the requirement (if it so happens) to register with Court of Protection once capacity has been lost. We can give you an indication of the cost of preparing your Power of Attorney at the end of your initial interview and you can then decide whether or not to proceed.